Nearly Half of Digital Bank Customers Prefer Digital Wallets

Pay by bank is starting to look less like a niche payment option and more like a switch consumers will make when merchants pair it with real value and clear protections.

The PYMNTS Intelligence report “Pay by Bank Deep Dive: Digital Bank Users Are Ready to Switch” examined how willing consumers in the United States are to move everyday spending to direct-from-bank payments and what it will take to get them there. The report was based on a survey of 2,071 adult bank customers conducted in June.

The central theme was not that digital bank users behave like a separate species, but that they are already trained for login-based payment flows through the use of digital wallets, while still demanding immediate savings and strong buyer protection.

That combination matters as digital banks continue to compete for primary relationships.

Key findings from the report:

13.8% of bank customers say a digital bank is their primary financial institution.

44.6% of digital bank customers prefer paying with digital wallets, above other bank groups in the survey.

35.4% is the estimated share of account-to-account transactions that digital bank users would shift to pay by bank if it came with discounts and buyer protection.

Other findings added texture to what “ready to switch” actually means. Digital bank users skew younger and more financially constrained, as 52% earn less than $50,000 a year, and 86% do not have college degrees.

In daily spending, many already default to wallets in mobile-heavy categories, including rideshare (51.9%) and gambling (60.3%), a sign that habit can shift away from cards when the experience is familiar.

The report also suggested that pay by bank’s competitive target is debit, but consumers need a reason to treat it that way. Although 72% said they already view pay by bank as a debit alternative or would do so under the right incentives, only about 12% currently see it as a substitute without added rewards or protections.

Incentives are also consistent across bank types. Among digital bank users, 43% rank immediate cash benefits as the top driver, while 24% of respondents overall said nothing would make them more interested, with digital bank users slightly higher at 25%.

Taken together, the data pointed to a practical playbook. Start where switching potential is highest, such as bill pay and A2A transfers, and pair the offer with protections people can understand.

Incentives matter. Protection matters. Simplicity matters.

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